On November 29th, KTM AG and two subsidiaries had to file for insolvency proceedings at the Ried im Innkreis regional court in Upper Austria. At the end of last week, the insolvency administrator, Peter Vogl, specified that, based on the information available so far, he was confident that bankruptcy could be avoided.
But KTM is faced with liabilities of 1.8 billion Euros: 1.3 billion of which are owed to 1,800 different banks. All creditors must now waive 70% of their claims. A first creditors meeting is scheduled for December 20th.
On February 25th, a final decision will be made as to whether KTM AG can be saved through the restructuring process. By then, the inventory of 130,000 motorcycles is also expected to have shrunk significantly, since production in Mattighofen will be shut down in January and February.
The head of Stefan Pierer - which increased sales figures from 6,000 to 381,555 after the KTM takeover from 1992 to 202, and has become Europe's largest motorcycle manufacturer - is currently working on a viable concept for the continuation of his life's work,, every day from 7 a.m. to 11 p.m. in his offices in Wels and Mattighofen.
Everything is being done to bring more equity to the accounts. That's why the MV Agusta brand is now being resold. KTM AG had first acquired a blocking minority of 25.1% from the Russian oligarch and oil magnate Rashid Sardarov on November 22nd, 2022. For this purpose, a capital increase worth 20 million Euros was implemented at KTM AG, with 10 million euros being rumored as the purchase price for the 25.1% share.
However, it was always clear that the resurrection of the ailing MV Agusta Motor S.p.A. in Varese would require huge investments. Over the last 20 years, MV had regularly made headlines with bankruptcies, factory closures, and strange decisions (for example, participating in the Moto2 World Championship with the poor Forward Team) after the luxury brand was bought by Cagiva founder Castiglioni.
Even under the new ownerm Sardarov, the situation didn't improve significantly. It was only under the KTM AG umbrella that MV Agusta flourished again. KTM board member Hubert Trunkenpolz was appointed CEO. He recently spent more time in Italy than in Upper Austria and set himself the goal of selling at least 5,000 to 6,000 MV motorcycles by 2025.
By taking over a majority stake in MV, the Pierer Group was, for the first time, able to offer three- and four-cylinder bikes in its model range.
Following its motto "Ready to Race", MV Agusta should soon be playing a prominent role in international motorsports again. Last summer, there was even talk of MV Agusta entering the MotoGP in 2027. Pierer and Trunkenpolz wanted to preserve MV Agusta as an independent brand and, unlike Husqvarna and GASGAS, not equip it with the KTM platforms. Production, therefore, remained in Varese, but sales were taken over by the Pierer Group. MV Agusta motorcycles should increasingly be sold in multi-brand stores, namely, through multi-brand dealers. There was also a joint 1,700 square meter stand for KTM, Husky, GASGAS, and MV Agusta at the EICMA trade fair in Milan in November.
"There will be no shift in production from MV to Austria," Hubert Trunkenpolz stated two years ago. "MV Agusta outside Italy, and far from the historic factory in Varese, would be doomed to die."
A Herculean task lay ahead of them because only 1852 MV motorcycles were sold in 2023. The number was still just under 1,000 in 2022.
Due to the insolvency proceedings, MV Agusta was no longer considered a strategically important asset for the Austrian company. Therefore, MV Agusta must stand on its own two feet again in the future. The CISL union members in Varese have now confirmed KTM's complete withdrawal.
Incidentally, as early as July, there were rumors circulating in the GP paddock that Pierer Mobility wanted to separate from the GASGAS brand. Hubert Trunkenpolz described that as "nonsense." However, GASGAS will withdraw from all the costly racing series and will primarily attract a young target group in the future.
KTM management has not yet confirmed their separation from the MV Agusta brand. No more information relevant to the stock market is being communicated, in order to avoid further unrest. There has already been enough worrying news in recent weeks that has caused the stock price to plummet to €11.60. That's why managers at KTM are currently keeping a tight-lipped attitude.
However, word got out from Italy that the Austrians are doing everything they can to ensure the continued existence of MV Agusta Motor S.p.A. for the future, even if no one yet knows who'll own this company in the future.
Stefan Pierer has, several times, recently guaranteed that he doesn't want to let his life's work, KTM, go under. But, so far, 48%-shareholder Bajaj in India, the Pierer Group's long-term strategic partner, has apparently not promised a capital injection.
Therefore, the creditors now expect Stefan Pierer to dig into his own pockets to save his life's work and be able to sell at least 250,000 motorcycles per year after a new start.